Click to Listen
Getting your Trinity Audio player ready... |
The Leadership Style of a manager significantly weighs on a firm’s performance.
A study conducted across half a million firms showed that the top 10% of high-performing firms had managers and founders that scored in the top 20% in leadership effectiveness. In contrast, the companies that scored in the bottom 10% had leaders score in the bottom 30% of leadership effectiveness.
Therefore, a company needs to evaluate its managers’ leadership effectiveness. For that, it is vital to understand the styles of Leadership. While there are several styles often discussed in this blog, we shall focus on two broad types that all leaders can classify as Reactive Leadership & Creative Leadership.
A leadership style refers to a leader’s approach when managing people/teams reporting to them.
Leadership styles determine how managers execute the path to achieving the company objectives while meeting stakeholder expectations and the team’s well-being.
A study by Daniel Coleman analyzed 3,000 managers, and they found that the Leadership style directly impacted 30% of the company’s profits.
Effective leaders inspire, delegate, empower and develop their direct reports.
Leaders fall into one of two categories based on their leadership style – Reactive or the Creative Leaders.
Reactive Leaders are those who decide in a reaction to a situation. They seldom think long-term. Their focus is on responding to the situation at hand.
Depending on the individuals’ inherent strengths, reactive leaders can be compliant, controlling, or protective.
Reactive leaders are a little stuck in the mud and are not good at responding to change. Being out of their comfort zone, they operate out of insecurity, fear, vulnerability, and self-interest. Typically, individual contributors having earned the elevation to the manager role based on their performance find themselves challenged to manage the transition from the role of an individual contributor to that of collective performance.
The complying types value their self-worth and want to be the apple of everyone’s eye. They avoid conflicts and controversial situations.
The passion for succeeding drives the controlling types. They will not accept failure; hence like to be always in control. They build the relationships needed for success. They do not delegate or trust anyone and fail to create a cohesive team.
The protective type is an analytical and critical breed. They seldom get involved in a situation. They keep themselves disengaged and are great at analyzing a situation, especially in the event of chaos, to come up with solutions. They come across as arrogant, overly critical, and analytical but protective. Their distant nature fails to create a connection among the team they lead.
Research reveals that nearly 80% of leaders or managers worldwide operate from a reactive place.
Protecting self and self-interest is the priority for Reactive Leaders. Everything else comes next. As a result, their decisions, on occasion, may not align with the organizational values or goals.
Creative leaders are change managers. They work and decide in line with the organizational values and goals. Working with the team to fire new ideas, innovate, and look for creative solutions that can significantly improve organizational efficiency while keeping the long-term progress of an organization are a few traits of the creative Leader.
Creative Leadership invests in team building and development. They delegate and empower their team members to take decisions while keeping them focused on their career development. They create an environment that allows team members to learn from their mistakes and take risks. Creative leaders make for inspirational moral leaders.
The Creative leaders are more secure, positive, and confident and build an agile organization, in stark contrast to Reactive leaders that focus on the situation today with little or no long-term vision.
Passion drives both reactive and creative leaders. While the former focuses on and delivers immediate results, the latter focuses on the organization’s long-term needs.
For instance, Reactive leaders can be ambitious, driven, and autocratic, pushing others constantly to attain perfection and deliver results. These qualities enable them to get things done efficiently. However, as reactive leaders tend to act out of self-interest, their results may not always be the best for the company’s collective vision. Since the mindset of reactive leaders is to preserve their position and maintain a tight grasp on their power, the business’s success in employee retention may suffer. While these leaders deliver results, the managerial style is less effective and fraught with self-limiting beliefs.
On the other hand, Creative leaders are more effective in delivering long-term results and company success as they are driven by a more profound sense of purpose, putting the company’s vision above their interests. Furthermore, creative leaders focus more on their passion for the organization and the accomplishments of those around them. Creative leaders are more likely to support the development of those around them, improving engagement, communication, and collaboration, leading to higher retention and productivity, which, in turn, benefits the company’s bottom line. Employees are also more likely to trust and follow the instructions of creative leaders and extend themselves on deliveries.
While it is difficult for Reactive Leaders to change their leadership style, making efforts to improve their Leadership would go a long way in helping improve the productivity of their teams. Reactive Leaders in a firm should take note of Creative Leaders and implement a framework to develop positive leadership attributes. Reactive leaders must identify their patterns and work with a leadership coach to become more effective leaders.
When leaders are reactive rather than creative, they act purely out of self-interest, trading long-term success for short-term goals. By working with a leadership coach, reactive leaders adapt their leadership style to become effective leaders. In contrast, creative leaders are driven by a sense of purpose, understanding the organization’s big picture, and working with employees to implement various systems and plans. Creative leaders not only get the best out of their employees but also tend to positively affect value creation in the organization.
